Will insurance cover my losses from an auto accident?

Depending on the types of coverage youhave, auto insurance pays for car repair or replacement, medical expenses, rental cars, towing, court costs, and other expenses up to the dollar limits of the policy. The front page of your policy (the “Declarations Page”) – shows the name of your insurance company, your policy number, and the amount of each of your coverages and deductibles. Here are the basic types of coverage:

1. Liability Coverage

This is required to meet Texas’ financial responsibility requirement. It covers the other driver if you are at fault. It does not cover your losses. If you can’t show proof of financial responsibility (insurance), you are driving illegally and may be fined anywhere from $175-$300 for a first offense. In Texas, the minimum amount of liability insurance required is $30,000 for each injured person, for a total of $60,000 per accident, and $25,000 for property damage per accident. This is sometimes called 30/60/25 coverage. If you were at fault, it will pay the other driver’s medical and funeral costs, lost wages, pain and suffering, car repair/replacement costs, car rental for the other driver and damages awarded by a court. If you’re sued, it will pay your attorney fees. Liability insurance usually covers drivers who are household members, a child away at school, or a person who is driving your car with permission. It might also cover you when you’re driving someone else’s car, including a rental car. Check your policy to make sure. You won't be covered when driving a car that you don't own but use regularly, like a company car.

2. Collision and Comprehensive:

If you still owe money on your car, your lender will require you to have collision and comprehensive coverages to pay for repair of your car or replacement at fair the market value of a car like yours without damage. Collision covers damage to your car caused by an auto accident; Comprehensive covers damage not caused by a collision. It won’t pay for an auto theft unless you report it to police.

3. Uninsured/Underinsured Motorist (UM/UIM) Coverage:

Pays your expenses if the accident iscaused by an uninsured or underinsured motorist, or a hit -and- run driver. If you don’t want UM/UIM coverage, you must reject it in writing. Bodily injury UM/UIM pays for medical bills, lost wages, pain and suffering, disfigurement, and permanent or partial disability. Property damage UM/UIM pays for auto repairs, a rental car, and damage to items in your car.

4. Medical Payments Coverage and Personal Injury Protection:

These pay for your medical andfuneral bills resulting from accidents, including an accident involving a pedestrian or bicyclist. It covers you, your family members, and passengers in your car, regardless of who caused the accident. Personal Injury is the same as medical payments coverage, plus 80 percent of lost income and the cost of hiring a caregiver for an injured person. If you don’t want PIP, you must reject it in writing.

What is a deductible?

The deductible is the amount you must pay before the insurance company will pay. For example, if you have a claim for $1,000 and a deductible of $300, the insurance company will automatically deduct $300 from the amount it will pay you.

The other driver was uninsured. What do I do?

How long to I have to file a lawsuit against the driver at fault?

Texas law gives you two years after an accident to either settle your claim or file a lawsuit. If the other driver’s insurance company wants you to sign a release, don’t do it until you are satisfied with the total settlement. Insurance companies are not allowed to delay payment of a claim to pressure you to sign a release.

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